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Developments in Securities Regulation, Corporate Governance, Capital Markets, M&A and Other Topics of Interest

Court Examines Intended Third Party Beneficiaries of Indemnification Provision

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In CHS/Community Health Systems, Inc. et al v. Steward Health Care System LLC, the Delaware Court of Chancery examined who was an intended third-party beneficiary of an indemnification provision in an Asset Purchase Agreement. The dispute arose in a transaction where Steward agreed to purchase substantially all the assets of... Read More

Topics: M&A, Public Companies and Securities

SEC Charges Ex-CEO with Aiding and Abetting Company’s Financial Reporting and Disclosure Violations

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The SEC charged former Hertz CEO and Chairman Mark Frissora with aiding and abetting the company in its filing of inaccurate financial statements and disclosures.  Frissora agreed to settle the charges and repay Hertz nearly $2 million in incentive-based compensation.  Frissora did not admit or deny the allegations. Select portions... Read More

Topics: Employment, Litigation, Public Companies and Securities

Homefed: MFW Conditions Not Timely Implemented

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In Re Homefed Corporation Stockholder Litigation arose from a transaction in which Jefferies Financial Group Inc., the 70% stockholder of HomeFed Corporation, acquired the rest of the shares of the company in July 2019 by exchanging two of its shares for each share of HomeFed held by its minority stockholders.... Read More

Topics: M&A

Delaware Supreme Court Interprets Books and Records Provision of Limited Partnership Agreement

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In Murfey v WHC Ventures, LLC the Delaware Supreme Court interpreted the books and records provisions of three limited partnership agreements.  The plaintiff wanted Schedule K-1s attached to the partnerships’ tax returns.  The partnerships countered that the K-1s were not “necessary and essential” to plaintiffs’ valuation purpose. The Court of... Read More

Topics: Private Equity

Director’s Undisclosed Conflict Prevents Application of Business Judgment Rule in Acquisition

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City of Fort Myers General § Employees’ Pension Fund v Haley, which was commenced in the Delaware Court of Chancery, grew out of the merger of equals between Towers Watson & Co. and Willis Group Holdings Public Limited Company.   Although Towers had stronger performance and greater market capitalization, under the... Read More

Topics: Litigation, M&A, Public Companies and Securities